Thursday, January 9, 2014

Key themes for 2014 -Theme 2: Stance on immigration policies (MKE)

Theme #2: Stance on immigration policies
Curbs on foreign labour inflow to stay. In our view, the current tight immigration policies will remain in place in 2014. We do not think the recent riot in Little India will significantly change the landscape because foreign workers remain critical to Singapore’s economic growth. As illustrated in Figure 13, the Republic has become increasingly reliant on foreign labour to meet its growth targets.

Influx of foreign workers has slowed in recent years. As shown in Figure 14, the growth in the number of foreign workers (excluding foreign domestic helpers) has slowed to 5.9% in Jun 2013, its slowest in four years. The slowdown was led by cutbacks in the number of foreign workers under Employment Pass (Figure 15). At end-Jun 2013, as many as 172,100 employment passes were issued, accounting for 15.9% of the total foreign workforce (excluding foreign domestic helpers).


What are the implications? We expect the job market to stay tight with downward bias for resident unemployment rate. As shown in Figure 16, resident unemployment rate (seasonally adjusted) has declined to its lowest just right before the global financial crisis struck. Figure 17 suggests the current very tight labour market will persist as demand outstrips supply. All this points to labour costs staying elevated, which bodes ill for labour-intensive sectors such as transportation, manufacturing, construction, hotels and restaurants. Within our coverage universe, the following names are more vulnerable:
SMRT, and
Sheng Siong.

Coincidentally, we have a SELL call on both counters.

Rising cost pressures to also hurt SMEs and banks by extension. Unlike the large-cap companies, small and medium-sized enterprises (SMEs) lack product and funding pricing power put it at a disadvantage to significant cost pressures. This has negative implications for the banks sector, given that SMEs receive most of their funding sources from the banks. In our view, any potential fallout would be mitigated by the fact that lending to the SME sector has been modest, as shown in the recent 2½ years (Figure 18). From end-2011 to mid-2013, SME loans posted a modest CAGR of 4.0%. At end-Jun 2013, they accounted for only 12.8% of system loans. But we note one downside risk – the percentage of unsecured SME loans has increased in the past three years (Figure 19).

Bottomline: The key messages are:
Labour cost will continue to stay high because of manpower constraints and this is expected to exert upward pressure on costs in the labour-intensive sectors. Within our coverage universe, SMRT and Sheng Siong are more at risk than the rest.
We expect SME loan quality to remain sound in anticipation of a stronger economy. Thus, any fallout would have a minimal impact on the banks sector.



Source/Extract/Excerpts/来源/转贴/摘录: MKE-Research,
Publish date: 06/01/14

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Warren E. Buffett(沃伦•巴菲特)
Be fearful when others are greedy, and be greedy when others are fearful
别人贪婪时我恐惧, 别人恐惧时我贪婪
投资只需学好两门课: 一,是如何给企业估值,二,是如何看待股市波动
吉姆·罗杰斯(Jim Rogers)
“错过时机”胜于“搞错对象”:不会全军覆没!”
做自己熟悉的事,等到发现大好机会才投钱下去

乔治·索罗斯(George Soros)

“犯错误并没有什么好羞耻的,只有知错不改才是耻辱。”

如果操作过量,即使对市场判断正确,仍会一败涂地。

李驰(中国巴菲特)
高估期间, 卖对, 不卖也对, 买是错的。
低估期间, 买对, 不买也是对, 卖是错的。

Tan Teng Boo


There’s no such thing as defensive stocks.Every stock can be defensive depending on what price you pay for it and what value you get,
冷眼(冯时能)投资概念
“买股票就是买公司的股份,买股份就是与陌生人合股做生意”。
合股做生意,则公司股份的业绩高于一切,而股票的价值决定于盈利。
价值是本,价格是末,故公司比股市重要百倍。
曹仁超-香港股神/港股明灯
1.有智慧,不如趁势
2.止损不止盈
成功者所以成功,是因为不怕失败!失败者所以失败,是失败后不再尝试!
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每逢灾难就是机会,而是在灾难发生时贱价买股票,然后放在一边,耐性地等灾难结束
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